Extreme Brexiteers may rail against the figures, but the fact is we are going to pay a heavy price if we exit the European Union. That is the most important message from the Autumn Statement Some of us hope public opinion will change and we can yet halt this madness. But as it stands we are heading out and the Chancellor has spelt out the consequences of Brexit.

£59bn of the staggering £122bn of extra borrowing is directly attributable to Brexit according to the Office of Budget Responsibility (OBR). Because of that borrowing our debt to gross domestic product is set to peek at 90% in 2017-18. The weaker pound caused by the Brexit shock is forecast to lead to a 5% increase in food prices next year. A real problem for the Just About Managing.


Perhaps it has been lost a little amidst the analysis of the immediate impact of the Autumn Statement but Philip Hammond this week flagged up a major area of controversy for the next parliament. The triple lock on pensions is to come under review. Rightly so, whilst some pensioners still struggle, most have never had it so good, to coin a phrase. In any case it is the young burdened by tuition fees, job uncertainty and the inability to buy a home that must be top priority for government in the third decade of this century, if not before. The problem is that up to now the elderly vote in larger numbers than the young. In the next parliament ministers will have to be courageous. I think pensioners will get the point but well done Mr Hammond for preparing the way for a change of policy.


At one point it looked as if George Osborne’s pet project was going to be quietly forgotten by his successor. However there was enough support for devolution to force the Chancellor to input significant funds into the Northern economy. £3bn for northern local enterprise partnerships in growth deals, a £400m investment fund to support smaller businesses and £60m in development funding for Northern Powerhouse Rail.

Areas about to elect city region mayors like Liverpool City Region and Greater manche4ster will get new borrowing powers. There is talk of a municipal bond to aid infrastructure investment. The continuing failure of Leeds to resolve the elected mayor issue and avail itself of these incentives is notable.

Specific road improvements include the highly congested part of the M60 near Worsley, the Waterfront Link in Warrington and dualling the A66 in the North Pennines.


The big challenge for business in the North is productivity. Nationally we are 30% less productive than the Germans and the North lags well behind London. A Productivity Investment Fund will help. There was relief that the increase in the Living Wage was modest and a welcome for the further cut in corporation tax. Some wanted a VAT cut to mitigate rising inflation but that wasn’t going to happen, nor apparently reform of business rates.


There is widespread dismay that the Chancellor did not address the growing adult social care crisis but overall Philip Hammond showed himself to be a safe pair of hands on his début. He is not as close to the Prime Minister as George Osborne was to David Cameron but nor is there the ruinous rivalry of the Blair/Brown years.

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Turbulent times require grey politicians and we have two at the top of government. Theresa May has turned off the daily flow of government initiatives to keep the press happy. A good thing too, the constant announcements from the Blair, Brown and Cameron regimes rarely amounted to much and were initiated in the vain hope of distracting hacks from the real stories.

Her next door neighbour and Chancellor, Philip Hammond makes John Major look exciting. But that’s not a problem for me. There is so much uncertainty in the world that we need a cautious person in charge of the money and that approach is likely to inform next week’s Autumn Statement.

Business in the North will want clear indications around the new Chancellor’s approach to the uncertainties of Brexit. Leavers are crowing at the moment because the economy hasn’t apparently suffered from initial Brexit damage. Let’s wait and see. If Hammond is wise he’ll be preparing the British economy for slower growth and higher inflation as the folly of us leaving the EU becomes more and more apparent. He will be hampered in shaping our economic future by the total disarray that is being revealed within government about what future relationship we actually want with the EU.

On taking office Hammond moved away from his predecessor’s deficit reduction targets. Price Waterhouse Cooper predict a gap of £67bn this year, a huge figure but will it matter to the Chancellor? We seem to be in a time when politicians prefer to forget the legacy they are leaving to future generations. That certainly seems to be the case with the incoming Trump administration in America where he breezily talks about a trillion dollar infrastructure programme.

While the Donald deals with his crumbling bridges, Hammond has a number of areas crying out for cash should he wish to spend it. Adult social care is at the top of the list, followed by the NHS and then councils.

Anyone with eyes to see can observe the plight of Town Halls. Libraries and bus services are being closed in a desperate attempt to support the growing needs of the elderly.

Then there is the housing shortage which is so badly affecting the young. I say young but in many cases married couples in their early thirties are still not able to afford a home of their own. The levels of stamp duty are being identified as a problem that the Chancellor might wish to address.

Then there is the Northern Powerhouse and Transport for the North. The latter is becoming an increasingly important organisation headed up by the former CBI boss John Cridland. He gave an impressive presentation to the North West Business Leadership Team recently about his vision for improved connectivity involving east-west rail and road links and simplified ticketing. The government revealed new route plans for HS2 this week. That project is seventeen years away. Next week the Chancellor needs to support some shorter term wins along the lines of the Cridland plan. It will also be interesting if Philip Hammond mentions the Northern Powerhouse. It was frequently mentioned in Osborne budgets. Despite denials there remains an impression that the May government has cooled on the idea or pivoted to the Midlands Engine.

Wednesday will be an important one for Philip Hammond and could define his whole Chancellorship.




The road to the Northern Powerhouse is proving more rocky than originally anticipated. Rows about elected mayors, the boundaries of Combined Authority areas and the complete lack of democracy in setting it all up means the North presents a patchwork of progress and delay ahead of the crucial Autumn Statement.

It looks as if the resistance of St Helens, Wirral and Halton to an elected city region mayor has been overcome and they look set to join Greater Manchester and Sheffield will devolution deals done this month. In Lancashire Wyre Council are holding out against joining a county wide Combined Authority, but it is in Yorkshire that the bitterest row has broken out.

The leader of Kirklees Council, the area around Huddersfield, has accused North Yorkshire Council of “blatant self-interest and gerrymandering”. David Sheard is referring to the proposals for Greater Yorkshire that have been submitted to the government. This is a plan to bring Hull, York and four North Yorkshire districts together. The rival plan brings together West Yorkshire, based around Leeds but including Craven, Harrogate and Selby. North Yorkshire has refused to give over its transport and highways powers in those three districts. This would put a major curb on the transport and infrastructure role of the Leeds based city region.

Apart from the row over boundaries, there is a feeling that there is now less on the table for Leeds than when it was named a frontrunner for devolution in the summer. Envious eyes are being turned to the deal struck by Sheffield with some concluding that the idea of accepting an elected mayor for Leeds City Region with less powers than Sheffield got may not be worth doing.

It needs to be noted that Leeds City Region has already negotiated a growth deal investment fund of £600m, and it has control of the adult skills budget. It wants powers to manage European funding, an infrastructure levy ability and to run the buses, but talks seem to have stalled.

Even in Greater Manchester there is growing discontent with the total lack of public involvement in the Combined Authority deal. A group has been formed, the Greater Manchester Referendum Campaign for Democratic Devolution, and they will be targeting the wards of the ten leaders of Greater Manchester in next May’s elections.

They claim public awareness is low about the deal which is all about business and growth but very little about issues like social housing. They also worry about the accountability of people doing the deals now and how the city region mayor will be held accountable from 2017.

Concern about this issue was expressed at a high level meeting of the Town and Country Planning Association (TCPA) held in Liverpool this week. It concluded that for all the talk of the Northern Powerhouse there was no urban policy to back it up and answer questions about the unsustainable growth of London, how continuing support for the North over many decades was going to be achieved and what was to be the fate of smaller northern towns with little growth prospects.

One of the speakers at the TCPA meeting was Alan Harding from Liverpool University’s Heseltine Institute. He’ll be leaving in January to become economic adviser to the Greater Manchester Combined Authority.








George Osborne may well have done enough to ensure the Conservatives are the largest party after next May’s General Election.


The underlying perception that the government has stabilised the economy has been around for a while and probably would have been enough to secure electoral success. This week’s blatantly electioneering autumn statement and accompanying announcements on roads, flood relief schemes and the scrapping of the trans Pennine pacer trains should prove the icing on the cake.


The fact that the election will be followed by a further massive attack on council spending, a probable failure to eliminate the deficit at any time in the next parliament and the real possibility of tax rises…well we’ll deal with that later.




Labour must be worried by the way that George Osborne has positioned himself as champion of the Northern Powerhouse but before we look at those measures, there is an important question. What happened to Nick Clegg’s promise that Leeds and Sheffield were to get their devolution packages before the Autumn Statement? Perhaps that was why the Lib Dem leader absented himself from the Commons. The word is that Clegg’s insistence that the package should not involve a directly elected mayor has not gone down well with the Treasury.


It is striking what benefits Greater Manchester is reaping from its coherent political leadership. On top of last month’s devolution package it is to get the Sir Henry Royce Materials Research Centre and a new theatre space at the old Granada TV site. It is to be called The Factory Theatre, a fitting tribute to Tony Wilson, founder of Factory Records, who did so much to champion the cause of Northern devolution.


But the rest of the north hasn’t been forgotten. Improved access to the Port of Liverpool, flood defence schemes at Rossall in Lancashire and the Humber Estuary and a College to train people for the oil and gas industries in Blackpool are all welcome.


A sovereign wealth fund is be set up so that northern communities can benefit from shale gas extraction and under new franchises for Northern and Trans Pennine rail services, the dreaded pacer trains are to finally be replaced.


The government is still not addressing the major devolution questions for the whole of the North, people are on low wages, food banks grow and the services people depend on may be swept away, but it is going to be difficult for Labour to match the Tories Northern Powerhouse concept.




There has been criticism that George Osborne has had two jobs, as Chancellor and Tory Party strategist. But you can see the virtue of it after Wednesday’s statement.


The Stamp Duty changes make Labour’s mansion tax proposals look clumsy and complex. It is true that their mansion tax would bring in a revenue stream every year whereas Stamp Duty is paid once. However the rich really will be clobbered by the changes whilst people buying lower priced houses are benefiting immediately from a welcome windfall.


To further tackle the perception that the Chancellor favours his rich friends, banks are facing a new tax and there will be an attempt to get multinationals to pay tax properly in the UK, although Osborne’s unilateral move is attracting criticism that it is not being coordinated internationally.


National insurance relief on apprentices, loans for post graduates, measures on Air Passenger Duty and ISAs, plus the petrol duty freeze will all contribute to a good feeling going into the election campaign.


Labour will rightly point to the big picture failure of the Chancellor to redeem his promise to balance the books in this parliament and the day of reckoning that awaits us all, but will that sway the voters?